EcoproBM's factory view.  (provided by EcoproBM)

The majesty of ‘Kosdaq market cap No. 1’… Will Ecopro BM exceed 600,000 won in electric vehicles and high nickel winds?

EcoproBM’s factory view. (provided by EcoproBM)

EcoproBM, the No. 1 company by market capitalization listed on the KOSDAQ, is on the rise.

As of 1:20 pm on May 4th, EcoproBM is trading at 525,500 won, up 1.86% from the previous trading day. It rose more than 13% in the last four trading days, and the previous day it broke through the closing price of 500,000 won again. It has been about 4 months since December 28 of last year.

Earlier, on May 2, EcoproBM announced that its operating profit for the first quarter of 2022 on a consolidated basis was 41.1 billion won, an increase of 130.3% compared to the same period of the previous year. During the same period, sales increased 151.7% to 662.5 billion won.

Securities analysts predict that EcoProBM’s first quarter earnings will continue. We raised our target price stating that electric vehicle demand and high nickel demand are continuously increasing in common. The analysis that it is advantageous to secure raw material supply and demand and appropriate cost thanks to affiliates also supported this. On this day, Eugene Investment & Securities raised its target price from 500,000 to 600,000 won and Shinhan Financial Investment from 64 to 690,000 won.

Byung-Hwa Han, an analyst at Eugene Investment & Securities, said, “Electric vehicle models scheduled for mass production such as iX, i7, F150, JEEP, RAM, etc., such as BMW, Stellantis, Ford, etc. We have raised our earnings forecast and our target price,” he explained.

The fact that EcoproBM’s production value chain is internalized also received high marks. He said, “For battery cathode material makers to achieve mid- to long-term growth, it is essential to secure cost competitiveness through internalization of the value chain and to commercialize next-generation (high nickel) cathode materials. Thanks to the expansion of the business of affiliates such as Recycle (Ecopro NG), it is relatively advantageous to supply and demand raw materials and secure reasonable costs.”

Shinhan Financial Investment analyst Jung Yong-jin pointed to high-nickel cathode materials as a factor in EcoproBM’s sales growth. High-nickel cathode materials are high-quality cathode materials boasting a nickel content of 80 to 90%, higher than the nickel ratio (60%) of general cathode materials. The higher the specific gravity of nickel, the higher the energy density and the greater the storage capacity. The high selling price is good for profitability.

Analyst Jeong said, “High nickel products to be produced at EcoproBM’s new plant are highly preferred, and shortage compared to demand (supply shortage) continues. It is estimated to have risen by nearly 20%.” He added, “Profitability is expected to improve in the second or third quarters (compared to the first quarter).”

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